Business Cycle Fund: ICICI Mutual Fund has announced the launch of ICICI Prudential Business Cycle Fund.
ICICI Prudential Business Cycle Fund: ICICI Mutual Fund has announced the launch of ICICI Prudential Business Cycle Fund. It is an open ended equity scheme, which aims to provide good returns to investors in the long term by investing in equity and equity related securities. This fund will keep its focus on the business cycle through dynamic allocation in different sectors. The scheme will open on 29 December 2020 and will be closed on 12 January 2021.
Choose the right theme and sectors
ICICI Prudential Business Cycle Fund will adopt a top-down approach. This scheme will invest in all market capitalizations. In this, a strategy will be adopted to identify the business cycle by monitoring the macro indicators (both international and domestic) and selecting the right themes / sectors and the shares in them. How long an existing business cycle will last or how soon it will end will depend on macro economic conditions. Also, it will depend on the government’s fiscal policy and the central bank’s monetary policy during the business cycle. In such a situation, you can get a good investment opportunity.
Advantage of diversification
The ICICI Prudential Business Cycle Fund operates in different ways. It focuses on macro (economy) conditions. This gives investors access to sectors that look attractive at any time. This also helps in achieving the goal of diversification in those sectors. The scheme will be managed by Anish Tawakale, Ihab Dalwai and Manish Banthi. The benchmark of the scheme is the Nifty 500 TRI.
Business Cycles and Returns
Nimesh Shah, MD and CEO of ICICI Prudential AMC, says that returns in the stock market are usually affected by different business cycle phases. There can be four different stages in a particular business cycle, such as growth, recession, decline and recovery. All stages are different, but identifying the key stages and analyzing them from the perspective of investment can help in gaining a positive investment experience.